March Markit Services PMI: "Fastest Rise In Business Activity Since July 2014 As New Order Growth Reaches Six-Year High"

The March US Services Purchasing Managers' Index conducted by Markit came in at 59.7 percent, down 0.1 from the final February estimate of 59.8.

Here is the opening from the latest press release:

Commenting on the latest survey results, Chris Williamson, Chief Business Economist at IHS Markit, said:

"The recent surge in service sector growth shows no sign of abating, with another impressive performance in March rounding off a quarter in which the PMI surveys indicate that the economy grew at an annualized rate of approximately 5%.

“While consumer demand is rising especially strongly for goods, the surveys are now also showing rising activity in the consumer services sector, linked to the vaccine roll-out, looser virus containment measures and the fresh injection of stimulus in March. Financial services growth is also booming, in part reflecting buoyant housing and equity markets, and business spending on services is likewise picking up as firms look ahead to better times, resulting in a very broad-based and powerful looking upturn in the economy.

“High levels of new business inflows, rising business confidence and an increasing appetite to hire new staff suggest the economy will also see a strong second quarter, especially if the vaccine roll-out continues apace.

“The biggest concern is inflation, with price gauges hitting new survey highs in March as demand often exceeded supply for a wide variety of goods and services.” [Press Release]

Here is a snapshot of the series since mid-2012.

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Here is an overlay with the equivalent PMI survey conducted by the Institute for Supply Management, which they refer to as "Non-Manufacturing" (see our full article on this series here). Over its history, the ISM metric has been significantly the more volatile of the two.

Markit and ISM Services PMI

The next chart uses a three-month moving average of the two rather volatile series to facilitate our understanding of the current trend. Since early in 2016, the ISM metric has shown stronger growth than the Markit counterpart.

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